DIGITAL PUBLIC CREDIT REGISTRY (PCR)

BE/RBI NOTE/48/2018

RBI is in the process of setting up a digital Public Credit Registry (PCR).  This will capture details of all borrowers across the Financing system.  Let us see more details about this:

• This wide wide-based digital Public Credit Registry (PCR) would capture loan information of individuals and corporate borrowers.
• RBI has now invited expression of interest (EOI) for developing PSC from companies with a turnover of over Rs 100 crore in the last three years.
• Formation of PCR is considered very important at a stage when bad loans are mounting in the financial system.
• The overall non-performing assets (NPAs) in Indian banking system is about Rs 10 lakh crore.

Public Credit Registry (PCR)

• PCR is digital registry of authenticated granular credit information.
• It will work as a financial information infrastructure and will provide access to various stakeholders
• It will thus enrich the existing credit information ecosystem.
• It seeks to serve as a single point of mandatory reporting for all material events for each loan, notwithstanding any threshold in the loan amount or type of borrower.
• PCR will capture all details of borrowers, including wilful defaulters and also pending legal suits in order to check financial delinquencies.
• It will also include data from entities like market regulator SEBI, Corporate Affairs Ministry, Goods and Service Tax Network (GSTN) and Insolvency and Board of India (IBBI.
• This will enable banks and financial institutions to get a 360-degree profile of the existing and prospective borrowers on a real-time basis.

Background

• It was in June 2018 that RBI had announced to set up a PCR for India with a view to
  • Address information asymmetry,
  • Foster access to credit and
  • Strengthen the credit culture in the economy.

• This decision was taken based on the recommendations of High-level Task Force (HTF) i.e. Y.M. Deosthalee committee
• This committee was constituted by RBI to review the
  • Current availability of information on credit,
  • Adequacy of existing information utilities and
  • Identify gaps that could arise

• At present, there are multiple granular credit information repositories in India
• Each repository has varied distinct objectives and coverage.
• Within RBI CRILC is a borrower level supervisory dataset with an aggregate exposure of Rs 5 crore.
• In India, four privately owned credit information companies (CICs) operate.
• RBI has mandated all its regulated entities to submit Credit Information individually to all four CIC.